Property visit/market appraisal
We will visit your property and offer a free rental valuation. We will also advise you on the best practice for successfully marketing and letting your property. In addition, we can provide interior design advice and furniture installations if necessary.
Instructing Crown Home Buying and Letting
Once instructed, we will ask you to:
Please note that capital expenditure is usually tax deductible not against rent but against capital gains on disposal.
If the property is a new build and if you request, once the property has been completed, Crown Home Letting can assist with the completion and handover from the developer by checking the property for any snagging issues.
We will arrange to have professional photos taken and floor plans of the property drawn up, which Crown Home Buying & Letting (CHBL) will pay for. In addition, we will film an in-depth property video tour where if necessary we will also dress the property with accessories, this will also be posted on our YouTube channel.
Your property will then be marketed on various property search portals including our website and Rightmove, the UK's leading property search portal.
We will deal with all applicant enquiries, conduct viewings and provide regular feedback to you on a weekly basis.
We will present to you all offers and assist you in achieving the best possible rental price based on current stock supply, tenant profile, the applicants' move-in date and payment terms.
Once you have accepted the offer, the tenant will pay a holding deposit equivalent to 1 week’s rent. There will be 15 days to complete the referencing and sign the agreement (this period can be extended on the mutual agreement by both parties required).
We will instruct a third-party referencing company to carry out reference checks on the tenant and their guarantor if applicable. This will include:
A reference report will then be presented to you for your approval. If required, we can assist you with obtaining a rental guarantee and legal protection insurance. Please refer to our Terms and Conditions for more information.
We will draft the tenancy documents for you and your tenant to review and sign.
The tenant will pay between 5-6 weeks security deposit, depending on the annual rent, and the first rental payment in advance. We will register deposit funds with Deposit Protection Scheme (DPS).
Preparation of your property for the new tenancy (if the property is managed by CHBL)
We will visit your property to ensure the apartment is in good order. If required, we will arrange maintenance, cleaning and relevant Health and Safety checks.
We will organise an independent inventory clerk to prepare an inventory report and schedule of conditions, of which a copy will be sent to you and the tenant to review and accept. Meter readings will be taken at the time of the inventory check.
Meeting the tenant and handover of the keys (if the property is managed by CHBL)
We will meet the tenant and explain how everything works in the property and provide them with all relevant information regarding utilities, suppliers and general building rules.
We will send you the first statement detailing the rental income and all expenditure associated with this tenancy and remit any funds within 3 working days.
Thereafter, each time we receive the rent from your tenant, we will send you a statement and remit the rental funds within 3 working days.
Utilities and block managing agents (if the property is managed by CHBL)
We will advise all utility suppliers about the new tenancy and request final bills to be sent to us on your behalf (for any void period). At this stage, if you would like us to receive ground rent and service charge invoices on your behalf, you will be required to notify the block managing agent to authorise us to act on your behalf (we will provide you with the necessary template and contact details).
Day to day management (if the property is managed by CHBL)
We will advise the tenant to contact us for any matters relating to the property, including any repair issues and emergencies that they may have and provide an out of hours emergency contact number for non-business times. We will liaise with contractors in the event any repairs might be required during the tenancy and provide you with any updates.
We will send you a property visit report every six months and highlight anything that requires attention.
We will ensure your property complies with all current health and safety legislation.
Three months before the tenancy ends, we will contact you and the tenant to discuss the renewal of the tenancy. We will appraise the property based on the current market conditions and will negotiate the best rent possible. Once a mutual agreement is reached, we will prepare renewal documents for both parties to sign.
End of tenancy (if the property is managed by CHBL)
Once we received notice from the tenant to terminate the tenancy, we will contact you to discuss the re-marketing of the property. We will liaise with the tenant about the end of tenancy arrangements.
We will arrange an independent inventory clerk to do an inventory check-out report.
A further visit to the property will be organised to do a final check and prepare the property for future marketing.
Return of deposit (if the property is managed by CHBL)
We will review the check-out report and negotiate on your behalf for any charges to be deducted from the tenant’s deposit (if applicable). Once both parties agree, the deposit funds will be released from DPS.
If you own a rental property in the UK and you’re not a UK tax resident (and also have no other income in the UK) then you’re required by law to declare and pay tax on any and all rental profits. You have until the 31st of January of the following year to complete your personal tax return. The UK tax year ends on 5th of April.
In other words, on January 31, 2023, you have to report rental income from April 6th, 2021 to 5th April 2022. For rental profits earned after April 6th, 2023 your reporting deadline is January 31st, 2024.
1. How to File Your Taxes:
You can file your own taxes by using the link using this link www.gov.uk/log-in-file-self-assessment-tax-return or through a Chartered Accountant. Your real estate agent should be able to provide you with your properties’ earnings and expenses for the past year. Please remember, there are costs which can be claimed that your agent will likely be unaware of.
2. How Much Tax to Pay:
If you are a non-UK tax resident and have lived in the UK for less than 183 days a year, the tax amount is only related to your UK Property income and gains.
If you are a UK tax resident and live in the UK for more than 183 days a year, the amount of tax you pay is related to your worldwide income and gains, and not just those arising in the UK. This means your usual salary, dividends, investments and rental income from anywhere else in the world. Even if taxes in other jurisdictions are taxed together, it’s still possible to claim some relief if you are an overseas national living in the UK. However, that remains outside the scope of this note. So, from this perspective, high-income overseas buyers have a distinct advantage.
3. Is There a Tax Allowance for Overseas Buyers?
Depending on residence and nationality, some taxpayers will be entitled to receive part of their income tax-free. Every UK/EU national and every UK tax resident is entitled to this personal allowance. The personal allowance is not available for non-resident Chinese nationals. The personal allowance for the 2022/23 tax year is £12,570.
4. What is the Percentage of Tax Paid In the UK?
If you are a non-UK tax resident and there is no exemption limit, please refer to the tax limits below.
£0 - £37,700 - 20%.
£37,701 - £150,000 - 40%.
£150,000 - 45%.
If you are a UK Tax Resident and Have a Tax Exemption, Please Refer to the Tax Limits Below.
£0 - £12,500 - 0%
£12,500 - £50,270 - 20%
£50,271 - £150,000 - 40%
£150,000 - 45%
However, please note that if your taxable income exceeds £100,000 then you will lose your personal allowance as the rate is £1 for every £2 of income exceeding £100,000. This means your allowance is zero if your income is £125,140 or above.
5. Which Expenses are Tax Deductible?
Tax deductible expenses are agency fees, services charges, ground rent, home maintenance fees, and expenses incurred solely and exclusively for your property.
6. Is Loan Interest Tax Deductible?
For individuals, loan interest on residential property is not tax-deductible, but it is eligible for tax relief at 20%. This, in effect, caps the tax deductibility of loan interest. If the amount of the loan increases due to refinancing which results in an extraction of invested funds out of your property business, the additional interest from the increased loan is not tax deductible. It is important therefore to ensure you structure your affairs property before you buy a UK property.
7. How do I calculate my profit before tax?
Annual rental income - expenses related wholly and exclusively to running the business = income - loan interest * ER%= profit before tax
ER$ – effective tax rate
(All fees and charges are subject to VAT at prevailing rate)